Check unfair trade practices in cement market — Manufacturers
Cement manufacturers have called on the government to check what they described as unfair trade practices in the country’s cement market.
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The Cement Manufacturers Association of Ghana (CMAG) has for some time now indicated that its advocacy for the protection of the local cement industry is not to stop competition but rather a crusade against the unfair trade practices surrounding competition which, in the association’s view, undermines the stability of the local industry and is likely to retard the establishment of a domestic industry.
Importation of bagged cement
In an interview, the chairman of the association, Rev. Dr George Dawson-Ahmoah, cited instances of importation of bagged cement from Nigeria under the guise of the ECOWAS Trade Liberalisation Scheme (ETLS) which, he said, disturbed pricing in the market and therefore affected the full use of the production capacities of local cement industries in Ghana.
Rev. Dr Dawson-Ahmoah said although the association was in support of the ECOWAS protocol under which these importations are made, in practice, importation of bagged cement violates some World Trade Organisation (WTO) regulations and called for safeguards to protect the local cement industry.
Evidence of dumping
He added that trade practices such as clear evidence of dumping, export subsidies, neglect of adequate local installed capacities had characterised ECOWAS trading and therefore become a threat to the domestic cement manufacturers.
“Cement importation from Nigeria is clear dumping by WTO definition,” the chairman declared, and explained that “the product had been dumped due to the fact that the export price of the product was less than its normal value in the exporting country Nigeria, and this effect of the dumping of the product was causing material injury to the domestic cement producer which was producing a like a competitive product”
Installed capacity
Speaking at the just ended Annual General Meeting of the Tema branch of the Association of Ghana Industries, where he was re-elected as the chairman, Rev. Dawson-Ahmoah indicated that the current installed production capacities of local cement producers was over 12 million tonnes as against an average consumption of about 5.4 million tonnes.
That, he said, indicated a surplus capacity which by WTO rules “increased imported quantities in absolute or relative terms to domestic production to cause serious injury or threaten to cause serious injury to a domestic producer.”
He further reiterated that competition must be fair and players must be honest and uphold the best trade practices.
Rev. Dr Dawson-Ahmoah said the obvious and painful effect of the unchecked importation of bagged cement would be to embark on down scaling of workers with its spiraling effect on families/dependents especially at this time that unemployment was high.
“Most of our industries are just collapsing because of unfair trade practices,” he said.
“We need to stop this injurious threat to not only the cement industry but all local industries and therefore we cannot wait for the promulgation of the Ghana International Trade Commission Act 2016 to provide for the regulation of the international trade of Ghana in conformity with the rules and regulations of the world trade system and to provide for related matters.” Rev Dr Dawson-Ahmoah added.
Current Members of the Cement Manufacturers Association, Ghana are: Ghacem Limited, Diamond Cement Group and CIMAF Ghana.